A man has been charged with murder after a stabbing attack in Sydney’s west that saw one person killed and two others critically injured on Tuesday.

The man, 25, had absconded from the care of health authorities 10 days before the attack while being transferred between hospitals.

About 10am on Tuesday, police allege officers responded to the scene on Merrylands Road, Merrylands after reports of multiple stabbings.

Police had been told a man allegedly stabbed multiple people inside a business before fleeing the scene.

Police officers stand on footpath of shopping strip, talking to each other and members of the public

Police speaking to witnesses after the Merrylands stabbing attack on Tuesday. (ABC News)

A 38-year-old man died at the scene while a 47-year-old woman and a 21-year-old man remain in critical condition in hospital.

The 25-year-old man was arrested a short time later on nearby Smythe Street.

Western Sydney Local Health District (WSLHD) confirmed the same man escaped from care 10 days before the incident.

“The District is aware a person alleged to be involved in the incident is a recent patient of Cumberland Hospital, which provides acute inpatient care for people with complex mental health needs,” a spokesperson said in a statement.

“On February 7 … this person absconded from care while being transferred from Cumberland Hospital to Westmead Hospital emergency department for further medical assessment.

“NSW Police were notified and contact was made with the patient’s family, but all attempts by WSLHD to contact the person were unsuccessful.

“A formal review into the person’s care and treatment will be undertaken, which will include an external senior psychiatrist.”

Superintendent Simon Glasser on Tuesday told reporters that the man was known only for petty crime and multiple mental health reports.

Police believe a kitchen knife between 20cm and 30cm was used in the attack in the suburban shopping strip.

The 25-year-old man was taken to Granville police station, where on Wednesday morning, he was charged with one count of murder and two counts of wounding with intent to murder.

He is due to face a magistrate at Parramatta Local Court later today.